Fuel factors

Pain at the gas pump, according to widely held local perception, is worse in Jackson.

Gas prices are thought to be lower in surrounding communities.

"You just let your tank go down if you are leaving Jackson," said Roger Petersen, who often travels to card shows and similar events as owner of the Collector's Zone.

"Because you know you can get gas cheaper someplace else."

The Citizen Patriot put this belief to the test.

For five weeks from late April to early June, we compared daily gas prices in Jackson, Adrian, Albion, Ann Arbor, Battle Creek, Chelsea, Dexter, Hillsdale, Lansing, Leslie, Marshall and Mason.

The results?

Gas prices were higher than average in Jackson, but the difference was less dramatic than some motorists might expect.

Prices were consistently lower in eight outlying towns. The cheapest fuel flowed in Adrian, at an average 9 cents a gallon below Jackson's price.

Prices were 5 or 6 cents a gallon higher, on average, in Chelsea, Leslie and Hillsdale.

Overall, the Jackson price was 2 cents a gallon higher than average for the 12 communities.

Prices for unleaded regular gasoline were provided daily by AAA through its online Fuel Price Finder service. Discounts offered by some stations to customers who use certain buying cards or credit cards were not considered in the data.

The Citizen Patriot looked for the lowest price in each city. The numbers thus represent a comparison of the best prices in towns, not local averages.

Prices started as low as $3.36 a gallon in late April, thanks to a short-lived price war in Mason, and rose to about $4.20 in several towns.

The average price for all locations was $3.82 a gallon.

Prices clearly vary significantly between communities. The biggest gap was 15 cents per gallon between Adrian and Hillsdale, two cities 35 miles apart.

However, wholesale fuel costs are essentially the same throughout the region, said John Griffin, director of Associated Petroleum Industries of Michigan.

The best explanation for price differences is the intensity of retail competition varies from city to city.

"It all depends how aggressively they want to compete in the market," Griffin said.

Jerry Westgate, owner of 51 Wesco stores in Michigan, said the competitive nature of his business requires gas stations to keep up with competitor prices "street to street and hour to hour."

Jackson's lowest gasoline prices are often, although not always, found at Admiral stations.

"We try to be below everybody around here," said Angie Messner, manager of the Admiral at 846 N. West Ave. "We have a corporate strategy that I follow."

The corporate office in Lowell may raise pump prices when fuel costs spike, Messner said, but otherwise she follows the strategy to undercut competitors.

"They know if they try to match us, we will go lower," Messner said.

Once in a while, strategies like that start gasoline price wars.

Jackson saw a spectacular war on March 18, when neighboring Citgo and Admiral stations on the 2000 block of E. Michigan Avenue cut prices to $1.99 a gallon.
Cities with less aggressive "price drivers" tend to have higher fuel prices, Griffin said.

It is simply a reflection of the local market.

Westgate said competition is heated enough to leave stations with thin profit margins.

"People ought to be upset with the price of gas," Westgate said. "It's ridiculous. But this is macro economics. It is not us.

"It's really unfortunate for all of us, as consumers, that the convenience store industry makes less on a gallon of gas than the credit card companies."

Price differences found in various cities may have been minimized during the five weeks the Citizen Patriot studied because gas shot up over $4 a gallon in that period.

Data suggests price gaps narrow during periods of sharp increase.

On May 6, for example, the best price in Jackson was $3.67 a gallon, 17 cents higher than Lansing's best price.

Two days later, the gap was narrowed to just a penny as prices shot up to $3.88 in Jackson and $3.87 in Lansing.

Petersen noticed the same trend in recent weeks.

"A lot of time in this past year, the price in Jackson would be a good 15 or 20 cents higher," Petersen said.

"Lately, in my travels to outside towns, it's not so bad. It's bad that the price is up everywhere, but it has equalized."

City by city
Below are average prices of a gallon of regular unleaded gasoline from late April to early June. The numbers represent best daily prices in each city, not local averages.
Adrian, $3.75
Lansing, $3.76
Mason, $3.78
Marshall, $3.80
Ann Arbor, $3.81
Dexter, $3.81
Battle Creek, $3.82
Albion, $3.83
Jackson, $3.84
Chelsea, $3.89
Leslie, $3.90
Hillsdale, $3.90